Asian markets bounce back after recent losses

November 14, 2012


A man of Asian origin at work/FILE
HONG KONG, Nov 14 – Asian shares rose on Wednesday as bargain hunters moved in after a recent sell-off fuelled by concerns over Greece’s debt woes and the US fiscal cliff.

The euro, which sank to a two-month low against the dollar in Europe on Tuesday, edged up against the greenback and yen.

Tokyo ended flat, edging up 3.68 points to 8,664.73, Sydney gained 0.20 percent, or 8.60 points, to 4,388.4 and Seoul rose 0.23 percent, or 4.34 points, to 1,894.04.

In the afternoon Hong Kong climbed 1.01 percent and Shanghai was 0.23 percent higher.

Regional markets have suffered big losses since last week’s re-election of US President Barack Obama, with dealers fearing a stand-off in Congress in addressing the fiscal cliff of tax hikes and spending cuts that are due to come in on January 1.

If a deal is not brokered in Washington the package, drawn up during fraught spending cap talks last year, will most likely tip the world’s biggest economy back into recession.

Adding to the selling pressure is uncertainty over Greece after European finance chiefs put off for a week a decision on granting Athens the latest instalment of a multi-billion-euro bailout.

And in Germany a survey showed investor confidence had worsened in November as the region’s crisis began to drag on its biggest economy.

However, there was some good news for Greece with the threat of a default this week receding after it raised 4.0 billion euros ($5.1 billion) in short-term bond auctions, which should help plug a financing gap left by the stalled loan.

In forex trading the euro — which touched a two-month low of $1.2662 in London — bought $1.2716 in afternoon Asian trade from $1.2703 late Tuesday in New York.

The European single unit also rose to 101.17 yen from 100.85 yen, while the dollar firmed to 79.55 yen from 79.38 yen.

On Japan’s Nikkei troubled electronics firm Sharp surged on news reports that it is in final talks with chip giant Intel over a possible $500 million cash injection by the US firm.

In China eyes were on the Communist Party’s latest congress that approved its next leadership and which ended Wednesday, with investors hoping for an indication of future economic policy.

“Once that’s known it will set the tone a bit. If there is a reform-minded set-up then that give Chinese markets some support,” Lorraine Tan, vice president of research Asia at S&P Capital IQ in Singapore, told Dow Jones Newswires.

Wall Street finished in the red Tuesday. The Dow dropped 0.46 percent, the S&P 500 fell 0.40 percent and the Nasdaq lost 0.70 percent.

Oil prices were mixed, with New York’s main contract, light sweet crude for December delivery up cents to $85.22 44 a barrel and Brent North Sea crude for delivery in December down eight cents at $107.91 108.18.

Gold was at $1,727.21 by 0620 GMT compared with $1,726.30 late Tuesday.

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